In Virginia, Obamacare to Cause 23% of Doctors to Stop Accepting Medicare Patients

FAIRFAX, VA - OCTOBER 26: Republican presidential candidate and former Massachusetts Gov. Mitt Romney (L) talks with Virginia Gov. Bob McDonnell after campaigning at the headquarters of the Fairfax County Republican Committee October 26, 2011 in...

With the Presidential election one week away, it’s worth reviewing how Obamacare will impact the residents of key swing states. A new survey of physicians has found that 28 percent of doctors in Virginia intend to place new or additional limits on accepting Medicare patients, with 23 percent altogether refusing to accept new Medicare patients, because of Obamacare’s impact on the fees that Medicare pays to providers of health-care services. In addition, Obamacare will deeply cut Medicare Advantage for 174,000 Commonwealth seniors who are enrolled in the program, and drive up the cost of private health coverage, especially for those who buy insurance on their own. Read on for more details.

(DISCLOSURE: I am an outside adviser to the Romney campaign on health care issues. The opinions contained herein are mine alone, and do not necessarily correspond to those of the campaign.)

Obamacare to cut Medicare by $11,718 per Virginia retiree

Obamacare cuts Medicare by $716 billion between 2013 and 2022 in order to pay for part of the law’s $1.9 trillion in new health-care spending for younger people over the same time frame. My co-blogger Robert Book and Michael Ramlet have published a paper for the University of Minnesota showing that Virginia’s share of those Medicare cuts is $11.7 billion. This year, Virginia has 1,203,462 Medicare enrollees, which means that these cuts amount to $9,737 for every senior in the state.

Robert Book published another paper, this time with former White House budget official James Capretta, detailing Obamacare’s cuts to Medicare Advantage on a state-by-state basis. Robert and Jim found that, in 2017, Obamacare will cut $3,804 in Medicare Advantage services for every Virginian enrolled in the program: a 29 percent cut. 14 percent of Virginia’s seniors—173,844—are enrolled in Medicare Advantage.

Survey: 28 percent of Virginia doctors to limit their acceptance of Medicare

Last month, the Physicians Foundation published one of the largest physician surveys ever conducted in the United States, with 13,575 respondents. They asked physicians a broad range of questions, including several about their views on Obamacare. 56 percent of Virginia physicians said that the Affordable Care Act made them “less positive about the direction and future of healthcare in America.” Only 19 percent said it made them feel more positive.

If Medicare fees decrease by ten percent or more—as the Affordable Care Act will require—28 percent of doctors in the Old Dominion say that they will place “new or additional limits” on accepting Medicare patients. 23 percent say they’ll stop accepting Medicare patients altogether.

The survey also has bad news for Virginians on other forms of insurance. 20 percent of Virginia physicians say that they’ll place new or additional limits on Medicaid patients as a result of the Medicare cuts; 14 percent also say they plan to raise fees on those with private insurance in order to compensate for the cuts.

Individual-market premiums could increase by 19-85 percent

One of the most under-appreciated aspects of Obamacare is the degree to which the law drives up the cost of health insurance, especially for people who buy it on their own. While there are no published estimates for how Obamacare will affect non-group premiums in Virginia, we do have estimates from a number of analysts—including those from a key adviser to President Obama—for other states.

Obama adviser Jonathan Gruber has estimated that, by 2016, the cost of individual-market health insurance under Obamacare, relative to what it would have been under prior law, will increase by an average of 19 percent in Colorado, 29 percent in Minnesota, and 30 percent in Wisconsin. A highly regarded actuarial firm, Milliman, has estimated that individual-market premiums in Ohio could increase by 55 to 85 percent.

Because Obamacare forces insurers to cover a buffet of benefits that they don’t have to today, the cost of insurance will go up. Another driver of higher premiums is the fact that insurers will have to cover everyone, regardless of previous health status, a change that will attract sicker enrollees at the expense of healthier ones.

Some Obamacare defenders try to argue that these cost increases don’t matter, because a slice of the low-income population will benefit from the law’s subsidies. But if you’re not eligible for subsidies, or only partially eligible, you will be exposed to the law’s dramatic increases in the cost of insurance. And remember that Obamacare has an individual mandate, which will force most Americans to absorb these higher costs.

And then there’s Obamacare’s tax increases

Finally, it’s worth touching on Obamacare’s tax increases. From 2013-2022, Obamacare increases taxes by $1.2 trillion, which amounts to $15,796 for the average family of four. Virginia's share of those taxes is approximately $32 billion.

Obamacare’s defenders will claim that many of Obamacare’s taxes fall on corporations and upper-income individuals. But these taxes will get passed down to every American. For example, the law applies an excise tax to health insurance premiums, which insurers will be forced to pass down to individuals in the form of higher premiums. Analysts estimate that this tax could increase premiums by as much as 3 percent, amounting to more than $500 for the average Virginia family in 2014.